OFAC issues Ethiopia-related designations and publishes new general license and two frequently asked questions

On November 12, 2021, the Department of the Treasury’s Office of Foreign Assets Control took several steps to address and deter the ongoing military conflict and humanitarian crisis in Ethiopia caused by the Government of Eritrea and its military.  The steps include OFAC’s designation of four entities and two individuals who have contributed to the conflict and crisis in Ethiopia and the publication of a new general license and two new frequently asked questions (FAQs 935 and 936) to provide further guidance on the impact of these new measures. 

OFAC designated the Eritrean military, also known as the Eritrean Defense Force (EDF), that has engaged in ongoing fighting and violence in northern Ethiopia and has blocked humanitarian aid to the region causing thousands to die and millions to suffer.  OFAC also designated the People’s Front for Democracy and Justice (PFDJ), the sole political party in Eritrea led by Eritrean President Isaias Afwerki, who, according to OFAC, has issued direct orders to EDF generals in the conflict contributing directly to the Ethiopian crisis.  The EDF and PFDJ were designated pursuant to Executive Order 14046, for being a government or political entity that has facilitated the crisis in northern Ethiopia or has obstructed a ceasefire or peace process to resolve such a crisis.  

The remaining designations were imposed against individuals and entities who were members or supporters of the PFDJ. The designations, issued pursuant to EO 14046, include the Hidri Trust, the holding company of all PFDJ business enterprises, that was designated for being owned or controlled by the PFDJ, and the Red Sea Trading Corporation (RSTC) that was designated for being owned or controlled by one of the newly-designated individuals. 
 
As a result of these designations, all property and interests in property of today’s designees within the United States or within the possession or control of a U.S. person are blocked, and U.S. persons are generally prohibited from engaging in transactions involving the designated persons. 

In addition to the designations, OFAC issued Ethiopia General License 4 that authorizes wind down transactions involving the Hidri Trust and RSTC until December 14, 2021.  GL 4 also specifies that OFAC’s 50 Percent Rule does not apply to persons blocked solely pursuant to the blocking sanctions in section 2(a)(i)(A) of EO 14046.

OFAC published FAQ 935 to emphasize that actions taken by the US to block Hidri Trust and RSTC should not restrict the ability of US and non-US persons to engage in humanitarian efforts in Eritrea or Ethiopia, while FAQ 936 reiterates that OFAC’s 50 percent rule does not apply to persons blocked solely under EO 14046 blocking sanctions.

Department of Treasury Press Release | OFAC Recent Action | General License 4 | FAQ 935 | FAQ 936

 
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